Group #496

Kanika Purwaha
Veronica Agbugblah
Kiana M. Nunez
Shizhen Jia
Zaireea Norman
Tumashenko Viktoria
 Table of Contents
1. Executive Summary .......................................................................................................................... 2
MARKET .............................................................................................................................................. 3
1. Objectives................................................................................................................................... 3
2. Competitors ............................................................................................................................... 3
3. SWOT Analysis ......................................................................................................................... 5
4. Additional Internal and External Research ........................................................................... 6
4.1 GAP Analysis ........................................................................................................................... 6
4.2 Bcg Matrix ( Boston Consulting Group) ............................................................................... 6
4.3 Pestle Analysis ......................................................................................................................... 7
4.4 Michael Porter five forces ...................................................................................................... 8
5. Revenue and Cost drivers ............................................................................................................ 9
6. New Target Market....................................................................................................................... 9
7. Market analysis ........................................................................................................................... 10
8. Pricing Strategies ........................................................................................................................ 11
9. Promotion Strategies .................................................................................................................. 12
10. Scale Analysis ............................................................................................................................ 12
MARKETING ..................................................................................................................................... 13
1. Promotional Materials ............................................................................................................ 13
2. Tailored marketing brochures ............................................................................................... 13
3. Message .................................................................................................................................... 14
OPERATIONS .................................................................................................................................... 15
1. Entry Modes ................................................................................................................................ 15

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1. Executive Summary

Cultural and tourism have continuously been relatively connected. Cultural attractions, events, sights
provide motivation to travel and travel automatically generates culture. In recent decade we can find a
link between the tourism and culture has been more clearly classifies as explicit form of consumption.
With the emergence of cultural tourism as a societal phenomenon it helped in growing cultural
understanding and reconstruct shattered economies.
Culturally is a company that provides a bridge between the tourists and the culture of all over the world.
They provide one-stop platform to bring meaning to your holiday. Its mission is to help travellers to
understand and experience old traditions. They provide new adventures to passionate ones that will
challenge them to grow.
This report seeks in the marketing analysis and the situation analysis on which the new market selection
ideas for the company can be generated and increase the profit ratio and the market share of Culturally
in the industry. Analysis like SWOT, GAP and competitive scenario is done with the Poter’s 5 forces
analysis. These analysis gives us the idea about the competitive advantage that Culturally has, also
given the financial that is required for the project.
Before developing a marketing strategy its necessary to conduct a scenario analysis to work out the
health of your business. This analysis is a greater tool for decisive your business’s strengths and
weakness and any opportunities and threats which will have an effect on its health. The result will be
eye opening to what extremely occurring among your business and facilitate verify your business’s
strategy among the market place.
In Section one, the competitive advantages of the company are clearly defined with respect to the details
which we need to know to start a new idea so that it will increase the company productivity. And based
on the analysis we identifies the promising new market for culturally.
In Section two, the Promotional Channels and Promotional Materials has been explained by which
Culturally can proposed new market. And the kind of channels Culturally could use to enter in new
market.
Section 3 contains the type of entry modes for culturally so that they can easily enter in the market

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 MARKET

1. Objectives

• Industry and Competition Analysis

To try and understand the industry Culturally is in and how they stack up to their competitors.
In this section, a series of analyses are done like a SWOT and Product Life-Cycle analysis.

• New Market Section and Analysis

With the analyses from part I, we look at what locations who be best for Culturally to expand
in. This is done by looking at potential clients, key competitors’ locations, political and
economic factors.

• Promotional Channels
There are many outlets that can be used to get news out about Culturally. There is tv, radio,
and social media. Here we analyze what channels will create the most engagement with
Culturally. An example is using travel blogger’s platforms to showcase Culturally’s local
experiences.

• Message
Best advertising strategy for Culturally’s success

• Entry Mode
Create cost effective ways to create Culturally Ambassadors in new locations the company will
be expanding into. Create a seamless supply chain with both vendors and management teams
so customers will get authentic, organized local experiences.

2. Competitors

There are many online companies that offer travel services. Culturally provides unique hands-
on experiences to end-consumers (B2B and B2C) with the assistance of cultural aspects and
activities to do within Singapore and Shanghai. Also, they provide assistance on their online
platforms where one can talk to real-people for better quality of assistance. The most important
competitors of Culturally will be described below. Considering that Japan will be the new focus
market (specifically Tokyo), some of the competitors are specifically mentioned for Japan.

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• Trip advisor has an online platform where you can view and choose things to do. They offer
the consumer with all the necessities such as flights, hotels, cruises, things to do,
restaurants, etc. The big difference is that it doesn’t emphasize the cultural aspect of the
areas and does not provide unique hands-on experiences. They do provide culture tours and
classes on the website under “things to do.”

• AirBnb is one of Culturally’s main competitors as it comes closest to supplying real cultural
experiences. The online platform has a multi-sided business model as it brings together
customers (that want to book a stay or book activities) with the suppliers (that have a place
to stay or can do activities). However, the amount of activities is very high and the quality
could be doubtful as the selection process is different (less specific) than Culturally.

• Expedia allows the consumer to pick the location and dates of travel so that they can provide
the consumer with the best hotel and flight options. The website also 4 provides people
with a “things to do” category which involves popular tourist locations and activities to do
in the area. However, Expedia is more focused on hotels and flights, and less focused on
the sale of activities (especially hands-on experiences).

• ATJ is an online website that gives details of the area that the consumer is looking to travel
to. They provide details of the activities to do in the area of travel. They are different from
the other competitors because they do not provide prices on the website. The service they
want to provide is assisting the consumer in planning their trip while leaving the choice of
activities up to the consumer.

• Triphobo is an online company that partners with other businesses to provide cheaper travel
and stay. The website provides the consumer with tours and activities while giving a small
discounted percent for every tour they provide.

• Local business in japan, Japan-Guide.com, provides information to the consumer of what

japan has to offer from hotels to tourist activity and then acts as a middle-man to other
businesses when one is ready to book their tour. They provide links for booking hotels,
flights, buses, car transportation, and tours.

Prices for all of the tours are somewhat similar throughout all competitors. Culturally does not
provide flight or hotel information on their website. Culturally provides a culture overview of
the area and provides the consumer with more hands-on activities and learning experiences.
No competitor emphasizes the cultural aspects of the location however some do provide
cultural tours. The main competitive advantage of Culturally is undoubtedly their view of
“quality over quantity” when they choose their cultural ambassadors to provide the unique
hands-on experiences. No other competitor is doing this. Additionally, Culturally is one of the
only ones that has a business model focusing on the B2B side of the market.

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3. SWOT Analysis

Strengths:
Hand Picked, hands on cultural experiences: Culturally has a process where only hand selected
individuals and activities are allowed to be put on their platform. This creates a standard of
high-quality experiences that customers can learn to trust and enjoy. Also, an idea of
exclusivity is created.
Book Easily, Pay Securely, Payment Methods: Expanded paying platforms from just Alipay
and WeChat Pay
Multilingual Customer Service
Dedicated Concierge Service
Markets; Consumers and Corporate Clients. They have two business models to make sure they
are creating the most efficient product line for potential customers; B2C and B2B
Diversity and inclusion activities. Can give you an edge on marketing because not a lot of other
brands doing things like culturally have this exclusive product line.

Weaknesses:
Operating hours is Monday-Friday 9am-9pm Singapore/China Time (UTC +8)
Only in two countries; limited opportunities and client base
Not many liquid assets; can be used to expand their current business or create more products
for their brand
No rewards program; As e-commerce businesses are on the rise, a lot of them have created
loyalty/rewards programs. Might be able to offer discounts on certain purchases or accumulate
points to get free experiences.

Threats:
Losing Business to competitors since they only offer experiences in Shanghai and Singapore
Compared Prices
Airbnb Experiences – an established, well-known brand

Opportunities:
Have room to expand to other Asian countries, creating more business and revenue
Small, have many new markets to explore
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4. Additional Internal and External Research

4.1 GAP Analysis

• Current state of the department

Operational market in Shanghai and Singapore

• Future of the department

Operational in multiple/more Asian countries

Beijing market (coming soon)

• Gap
Lose out on potential consumers since only operational in 2 Asian countries

• Closing the gap

Gradually expand market to Asian countries they are not operating in

4.2 Bcg Matrix ( Boston Consulting Group)

It’s a strategic tool that can be used by Culturally to analyze their business unit or products on
the basis of relative market share and market growth rate. This analysis will enable Culturally
to allocate financial resources (invest) or to divest. The matrix is made up of four quadrants
namely Stars, Question marks, cash cows and dogs.

• Question marks : they are products with low market share in high growing market. With
Culturally plan to expand to Beijing city, there is a need to manage the business well so it
will grow rapidly. Therefore Culturally must invest more Beijing city. Question marks
products are at the introduction stage.

• Stars: these are businesses with high market share in a fast growing market. These are
market leaders in a fast growing market. Culturally China and Singapore are stars so the
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 company must invest more to remain in competition with competitors. Stars are at the
maturity stage in production.

• Cash cows: they are products with high market share but low market growth rate. Here the
business might decline and profits are expected to be high because of the lower growth rate.
Culturally must generate cash needed to maintain the business. Products are at the decline
stage.
• Dogs: they have low market share and low market growth rate. Here the business consume
a large amount of money but barely generate enough cash to keep the business market
share. They are at the saturating stage in the product life cycle.

4.3 Pestle Analysis

It's a strategic tool that Culturally can use to analyse it external market in terms of politically,
Economically, Socially, Technologically l, Legally and Environmentally. Since Culturally
wants to expand its markets to other countries there is a need to analyse the it's external
environment.

With political factors Culturally must consider some the government policies that may affect
their business in Europe, Italy.etc.

Economically, Culturally must consider the income level of the workers in the country since it
affect can purchasing power of the people. The interest and exchange rate must also be
considered.

Socially the demographic of the people such as age, gender can all affect their purchasing
power that Culturally must consider.

Modern TechnologynnInnthe nen countrienncan affecn thein businesnnis well. The

development of new equipment and Technology can enhance their business in the new
markets..

Legal issues must also be considered since it may affect their business.

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The environment they are operating in the new market must be considered as well. Green issues
and pollution must be look at by Culturally.

4.4 Michael Porter five forces

Is used for analysing competition level in a certain industry. This framework is useful since
Culturally wants to expand their market base and enter new and international industries. The
state of the competition in the industry depends on the five forces.

Threats of new entrants, bargaining power of suppliers, bargaining power of buyers, threats of
substituents and intensive rivalry in the industry. The collective strengths of these forces
determine the potential profit of the industry and it's attractiveness.

• Threats of new entrants: is the ability of competitors to easily enter Culturally industry.
When barrier to entry is very low other competitors can easily take over the market but
when barrier to entry is very high it will be difficult for competitors and potential
competitors to easily enter the industry. Since Culturally is into trips and tour if it's barrier
entry is not very strong other competitors producing on a large scale, having very high
brands can affect th when they enter into the industry.

• Bargaining power of suppliers: the concentration of suppliers in the industry can affect
the prices of inputs.

• The bargaining power of buyers can also affect the industry: when the buyers are more
they determine the price of products by switching to other suppliers when a particular
supplier price is high.

• Threats of substituents: when Culturally's products can be easily substituted for it will
affect their business in the international markets. That is when buyers can easily switch to
other sellers.

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• The intensity of rivalry: the concentration of competitors in the industry can affect
Culturally. This when there are a lot of suppliers in the industry.

5. Revenue and Cost drivers

Among the revenue and cost drivers of Culturally are the following (but not limited) elements
that could be considered:
• Availability and amount of cities we are able to implement Culturally into
• Growth and reputation
• Activities and guidance
• Service Fees
• Travel expenses
• Possible taxes

In our analysis, we can see that the most costs are the cost of acquiring new ambassadors and
maintaining the online platform. As pointed out by one of the employees of Culturally,
acquisition of new ambassadors is time consuming and therefore they are focusing on quality
and not quantity. In the future expansion of Culturally is has to be taken into consideration that
it could take time to expand. Additionally, possible taxes in different countries also might be
subject to the costs of Culturally.

6. New Target Market

1. Hong Kong
Tax regime. In Hong Kong, the territorial principle of taxation is applied, that is, if the profit
of the company was obtained outside the jurisdiction, it is not subject to taxation. Hong Kong
does not have value-added tax, capital gains, dividends in and out, are not taxed at the source
and interest paid on loans, the interest income received is also not taxable if there are no Hong
Kong companies among the borrowers. This jurisdiction is now very popular with the global
business community. This is due to the fact that in recent years the mutual integration of China
and Hong Kong has intensified, especially in the areas of tourism, trade and finance. The
number of tourists increased almost twice from 2006 to 2017 and is 27884,000 arrivals per
year.
2. Kuala Lumpur

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Malaysia is visited by about 25.7 million foreign tourists a year. Mostly tourists come from
Thailand, China, Singapore, Indonesia and Brunei. By 2020, it is planned to increase the tourist
flow to 36 million people per year.
3. Bangkok
Tourist Market Status: The budget of Thailand comes 6% from tourism, this amount is
calculated in millions of baht, so the opening of the company's branch is quite justified. Today
Thailand is one of the main tourist centers in South-East Asia. The number of tourists visiting
the country increased from 400 thousand in 1967 to 32.5 million people in 2016.
4. Seoul
At the moment, South Korea’s focus is on developing cultural tourism. In 2018, the number of
foreign tourists in South Korea increased by 15%. In total, 15.34 million people visited South
Korea, of which 4.78 million, or 31%, were citizens of the PRC. In addition, 27% - up to 3
million people - the number of tourists from Japan increased, and 1.1 million tourists came
from Taiwan.
5. Tokyo (Japan)
The number of tourists who visited Japan in 2018 reached a record number - more than 30
million people. 16 million are tourists from China, South Korea, Taiwan and Hong Kong. By
contrast, only 10 million people visited Japan in 2013.
Thus, Bangkok and Tokyo as a whole are a promising markets for the development of
Culturally. They are the most popular tourist destinations from all over the world.

7. Market analysis

Pros
Strong consumer culture - japanese consumers are early adopters of new electronics and luxury
products. Tokyo, Japan is an ideal location to test market new services. Unemployment is
relatively low, near 3.5 percent and consumers have relatively high levels of disposable
income.
Large research and development (R&D) investments - Japan is ranked number three in R&D
investment at about $147 billion. Twenty of the top R&D investor companies are based in
Japan.
93 percent of Japan’s population has access to the internet
Japan is the third largest economy in the world

Cons
Relationship barrier - Japan’s business structure is set up through close relationships.
New entry businesses must establish a strong relationship prior from a partnership.
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More Info
National Capital: Tokyo
Population: 126.2 million (May 2019)
Land Area: 364,485 sq. km
GDP (official exchange rate): $4.96 trillion (2018)
Real GDP Growth: 0.9 % (2018)
GDP per Capita (Purchasing Power Parity): $43,118 (2018)
Household Consumption Percent of GDP: 55.5% (2017) 9
Unemployment Rate: 2.4% (May 2019)
Key Industries: among world's largest and most technologically advanced producers of motor
vehicles, electronic equipment, machine tools, steel and nonferrous metals, ships, chemicals,
textiles, and processed foods
Exports: $814.7 billion (2018)
Leading Export Destinations: Leading Sources of Imports: China 19.5%, U.S. 19.0%, South
Korea 7.1%, Taiwan 5.7 % Hong Kong 4.7% (2018)
Value of Imports: $827 billon (2018)
Major Import Categories: Petroleum, liquid natural gas, clothing, semiconductors, coal
Leading Sources of Imports: China 23.2%, U.S. 10.9 %, Australia 6.1%, Saudi Arabia 4.5%,
South Korea 4.3% (2018)
Global Trade in Goods Balance: $11.2 billion (2018)
Global Services Balance: -$7.2 billion (2018)
U.S. Exports to Japan: $121.1 billion (2018)
U.S. Imports from Japan: $179.1 billion (2018)
U.S. Trade Balance with Japan: -$58.0 billion (2018)

8. Pricing Strategies

Pricing depends on what cultural experience the consumers decide to book. The pricing would
be based on the activity and what the vendors decide on. Pricing could range from $2.40 to
$78. For example, while taking a food tour at the Tiong Bahru Market in Singapore the

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breakfast dish Chwee Kueh from Jian Bo Kueh which is a steamed rice cake topped with
radishes only costs $2.40 for 8 pieces. But a tea lesson would cost $78 and last for 2 hours.
There are plenty of options for a person to choose and the prices vary.

Group pricing is cheaper than individual pricing. The more people joining the same workshop
the more the price decreases and the end price could be split per person which would also make
it cheaper. For example, an individual attending a workshop could cost $50 but three people in
that same workshop could be $100 which could be split evenly amongst the group.

9. Promotion Strategies

Culturally.co operates on multiple social media platforms like Instagram, Facebook, and
Twitter. Consumers have posted about their experiences and included the sight and company.
This spreads the acknowledgement of this company to new/potential consumers. They also,
operate a blog where they write about culture and travel around Asia. They also operate on job
hiring sites like LinkedIn, Indeed, and Intern SG. They also appear on ExpatChoice which is a
website that helps promote touring services and site seeing in Asian countries.

10. Scale Analysis

Possibly bringing Culturally to other countries with similar cultures, but different languages
could be the best approach in expansion. This would allow Culturally’s expansion not to be
such a big risk but bring big returns from new markets. Bringing Culturally into Western
Europe would be more of a risk, but there is a lot of money to be made in travel platforms there.
In Europe it is very easy to travel from country to country with little hassle and this is something
Culturally could profit from.

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 MARKETING

1. Promotional Materials

Promotional materials are marketing strategies used to provide information and knowledge to
clients and customers about services offered. This also provide information to our potential
vendors and target customers in chosen new markets. Some of these promotional materials are
tailored marketing brochures, emails, social media posts extra. Promotional materials differ
from country to country based on consumers taste and preferences. For instance in China social
media marketing is an effective means of communication or interaction between users. We chat
,Weibo are real time interaction platforms used in a creative manner. Even with limited budget
businesses can use this means of communication or marketing to convene clients and customers
for their services. We chat has vivid guidelines for users who would like this means of
communication. It promotes better relationships and it also guarantees customer loyalty.

2. Tailored marketing brochures

• Culturally will prefer this medium of marketing because it will allow the company to
distribute brochures easily to allow international businesses to get accurate and reliable
information about their products and also to attract new and potential customers.
• The company will prefer this medium of promotional materials because it is cost
effective compared to other channels of communication on their products and services.
Producing brochures will enable Culturally to fit into its budget.
• Tailored marketing brochures will enable Culturally to build trust because their goals
and objectives will be stated in the brochures which will make their clients to make
informed decisions whether they are achieving those goals and objectives.
• Culturally will hold a lots of information when they use this means of communication
or marketing strategies because a lot of information can be compacted in a small area
of the brochures.
• This medium will enable Culturally to have one-on-one communication with their
clients as they read their brochures.

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Social medias: are internet services we use in communicating and doing online services.
Culturally can also use this means of communication because its quick to access and it will
also tell customers and clients about your products and services. Social media can also promote
Culturally brand and business or through the internet. It will also attract customers for
Culturally and enable them to build stronger relationships with existing customers of their
products and services. Some of these social medias are Facebook, Twitter, Whats app,
Instagram and so on. These mediums will help Culturally to target a specific groups of people
in a particular locations. Again, these medium of communication is mostly used by young ones
between the ages of 18-29 years of age which will be a good marketing strategies for Culturally.

3. Message

Target Market: Tokyo, Japan – Currently, culturally is operating in Singapore and Shanghai,
with plans to expand to Beijing as its third-city in Q4 2019. Our projected forecast for culturally
is to narrow in on Tokyo, Japan as their target market. The Japanese population boasts the
second oldest pollution in the world, just after Monaco (Ekab, 2015). This signifies a vast array
of cultural mix within this region.

Secondly, the consumer behaviour in Tokyo, tends to have a long tended to prefer quality over
mass production which fits seamlessly with Culturally’s quality of quantity principle in
production. Though their consumption behaviour also shows signs of high brand loyalty, their
strong desire for new products and generally consumers adopt brand innovations which sees
their loyalty declining steadily which culturally can capitalize on as a new entry to the Tokyo
market

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 OPERATIONS

1. Entry Modes

Entering in the Japanese market has become a challenge for the western companies of all sizes
and shapes. Despite the fact of economic climate in Singapore and western countries, Japan’s
economy has continuously growing by double digit rates over the last 2 years. Japan rapidly
changing demographics, increased consumer spending, rising incomes and open business
atmosphere helped making Japanese market increasingly striking to western businesses across
the variety of industries.

As the Culturally have limited resources at the company’s disposal, to enter in the international
markets and as the company is planning to enter in the Tokyo.

Presence of a strong local Heritage Culture: considering important to global interests and
international protection with the long history and rich culture Tokyo is the home to 2nd largest
number of heritage sites.

At the instant, we tend to are currently still trying to find contacts for Culturally to enter the
market of Tokyo. However, we tend to do agree that translators would be the simplest thanks
to facilitating in this challenge of difference in language. moreover, we've to search out locals
to reach intent on the simplest family and cultural businesses to become vendors. this might be
done by viva-voce furthermore as advertisements to the correct client section.

Culturally should partner up with the chamber of commerce, this can permit them to join up

with the native businesses in Tokyo. In the entry mode, it'll be a tedious business to business
conferences to make relationships. In Tokyo there are several cultural activities offered:

• cookery businesses that provide tours and lessons

• In Tokyo, the culture includes creating Ramen, sushi, character lunch boxes, Hand-
made udon noodles, mochi and wagashi categories, wasabi, matcha tea, 7-dishes, etc.
• Artisanal businesses that provide active experiences
• Some artisanal experiences that Tokyo has got to offer: are ninja tours where one
dresses like a ninja and learns the ins and out of the ninja culture.

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 • Pottery workshops are often found in Tokyo but the foremost famed workshops are
situated in Arita or Kaga.
• Glass-making businesses wherever some involve glass processing and others involve
etching.
• Weaving workshops, expertise, however, washi paper is formed, daruma doll creating,
kokeshi doll creating, tatami mat creating.
• ancient experiences are offered in Tokyo and areas around
• Wadaiko percussion in Shibuya provides lessons in wadaiko that is a combination of
exercise, arts, and music.
• ceremony at the Koomon that offers full-day courses within the making and drinking
of tea
• adult female recreation is high of the road tradition in japan wherever extremely skilled
entertainers do a range of arts from dance, flute, shaimasian (three-stringed guitar),
singing, furthermore as acting.

The chain of commerce in Tokyo is a good place to travel to for info of the local businesses.
The chain of commerce main mission:

1. Primary Proposal - because the voice of Tokyo’s community the chain of commerce desires
to keep up and develop a healthy economic setting by keeping a powerful and competitive
community

2. Business Support - they supply support to the companies so that they will still develop. they
supply membership services that assist the SMEs' activities permitting businesses to realize the
strength and become additional important. (in B2B Culturally Target are these SME
businesses)

3. Community development - they assist in building relationships between businesses as well

as businesses to the community. this can be to make an additional spirited society filled with
dynamic industries and build an additional engaging Edo.

Another nice partnership to appear in is informative and steerage websites. Through analysis,
we tend to found that tons of them contain links to different travel websites like Expedia or
Airbnb links. Culturally, these informative websites contain careful information on cultural
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activities to try to within the space. Therefore; Culturally may have their link therefore
individuals searching for that cultural expertise will find precisely what they're looking for
from an organization that cares concerning providing individuals with the culture of the region.

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